Americans are seeking out and are willing to pay a premium for environmentally friendly products, but most (74 percent) don’t know how to identify them—suggesting that marketers aren’t positioning these products optimally. But it turns out that over-promotion of this feature could also be detrimental to success, according to a new study from environmental tech firm GreenPrint.
The first-ever edition of the company’s Business of Sustainability Index found that nearly two-thirds (64 percent) of Americans are willing to pay more for sustainable products. According to the findings, 78 percent of people are more likely to purchase a product that is clearly labeled as environmentally friendly.
The study also found a large degree of mistrust about companies’ environmental claims
A majority of people have doubts when companies say they are environmentally friendly, with 53 percent of Americans never or only sometimes believing such claims. To trust a company statement, 45 percent of Americans say they need a third-party validating source.
“Businesses are in a bind. Broadcasting sustainability would capture an untapped consumer base but also sow distrust,” said Pete Davis, CEO and co-Founder of GreenPrint, in a news release. “We’d suggest they follow the data. Third-party validation helps certify progress in the eyes of consumers, and the process of carbon offsetting—which is easy to measure and communicate—helps create tangible benchmarks. Both are good tools for building trust. It’s about exploring your trustworthy methods of communication, then selecting one that aligns with your objectives.”
Other key findings of the research include:
- 75 percent of Millennials are willing to pay more for an environmentally sustainable product, compared to 63 percent of Gen Z, 64 percent of Gen X, and 57 percent of Boomers.
- 77 percent of Americans are concerned about the environmental impact of products they buy.
- More than half (56 percent) of Americans would use a credit card that could calculate and offset the environmental footprint of products purchased.
- There’s a noticeable break between generations, with 71 percent and 66 percent of Millennials and Gen Z willing to do so, compared to only 50 percent Gen X, 46 percent of Boomers and 39 percent Silent Generation.
- 76 percent of Americans would switch their preferred packaged goods brand if they were offsetting carbon emissions, 74 percent would switch gasoline brands in the same situation.
- Comparing sectors, 78 percent of respondents said food/groceries are doing well in terms of demonstrating their commitment to environmentally friendliness. Tech is close behind at 74 percent, while gas stations and convenience stores rank lower at 51 percent and 54 percent respectively.
This index and its future editions will track sentiment around sustainability in the economy – how climate consciousness impacts consumer preference and perceptions of companies and their products, as well as the overall effectiveness of the sustainability benchmarking ecosystem across various sectors and demographics.
“Companies must build trust and loyalty by clearly demonstrating that they share environmental goals with their customers,” Davis added. “Defending and preserving our planet is not only the right thing to do, it’s good business. Companies that are able to navigate the business of sustainability will be best positioned for future success.”
The survey was fielded from February 15 to February 16, 2021 among a demographically balanced nationally representative sample of 1,017 U.S. adults 18 years of age and older. To ensure consistent and accurate representation of the U.S. general population 18 years of age and older, data was weighted by the following variables: sex, age, geographic region, race/ethnicity, and education.